For all you Romans out there, happy X/XX/XX. As we sail through October, are these the best quarters to be an originator, or a lender, ever? Yes. If you believe Fannie Mae, annual mortgage originations are likely to top $4.1 trillion for the first time ever, as there will be more refinancings this year ($2.6 trillion plus $1.5 trillion of purchase deals) than total loans produced in 2019 ($2.46 trillion). That would trump 2003’s $3.7 trillion, when some LOs were in 1st grade. Freddie Mac is thinking $3.6 trillion. Yes, we lagged earlier this year, but that’s an average of $300 billion a month, $70 billion a week, $14 billion a day. And this despite the primary/secondary at or near an all-time wide, which means that even if MBS prices are constant, rate sheets may improve. Regulators are intrigued, especially since 13 of the top 20 aggregators are not banks. Remember March? Adequate capital is a real concern. But for now, party on, right? And remember, in the rush to return to normal, it’s important to think about which parts of normal are worth rushing back to.


Broker and Lender Products and Services

Maxwell just announced the second edition of its popular MAXOUT 2020 Virtual Conference taking place Nov 16-18. MAXOUT Fall is a 100% free, web-based "unconference" designed to teach, challenge, and inspire you to grow your lending business into 2021 and beyond. Tune in for insights from MBA’s Chief Economist Mike Fratantoni, NexLevel Founder Mike Hammond, me, and other top industry experts on the pivotal topics affecting today’s market. MAXOUT’s three-day agenda packed with value-add information lets you choose sessions that matter to you and that work for your busy schedule. These aren’t product pitches; instead, gear up for thoughtful insight into today’s unprecedented lending environment from renowned leaders and thinkers in the space. Sign up for FREE here

With 50 more business days left in the 2020 calendar year, loan officers are looking to cross the finish line strong in what will likely be a record year for most, if not all, lenders. Home Point Financial, one of the more popular lending partners for both mortgage brokers and correspondents, is doing its best to help the cause. Home Point is committing to 48-hour underwriting turn times on select loans for well-qualified conventional refinance borrowers. To learn about the criteria that need to be met, contact your Account Executive. Mortgage brokers and correspondents that need to sign up with Home Point should visit their website.

One of the basics we all learned (or should have learned) was that to succeed in a highly competitive market, it is important to differentiate yourself. When working in a highly regulated industry, differentiation may be hard to achieve. If you find you are not growing as you expected or are having challenges accessing new markets, running the same technology as your competitor may not be the best decision. MortgageFlex is a technology provider that has specialized in providing the kind of flexibility that lenders need to truly differentiate by providing functionality for retail, wholesale, correspondent, HELOC, construction, manufactured homes, and consumer lending, all in one effective and easy-to-use platform. Combined with our integrations to the leading document and POS systems, it is a powerful combination that you can grow with. Contact us (and actually talk to us). You’ll see what a real partner can bring to your success.

Get on the fast track to becoming an independent loan officer. Interested in switching from retail to wholesale? Sign up for our “Mortgage Loan Officer 101” webinar training, hosted by the team at BeAMortgageBroker.com, on Thursday, October 22 at 2 p.m. EDT. You’ll learn the key differences between retail and wholesale loan officers, the benefits working in wholesale can offer you and your borrowers, what you can expect when you join a mortgage broker shop, and how you can get started. Even if you’re already a mortgage professional, we’ve got tips on how you can continue to improve — no matter how long you’ve been in the business.  Best of all, it’s a quick 30 minutes. Register now, spots are filling up quickly! 

As 120-day delinquencies hit a 21-year high, is your loss mitigation automation positioned for the long haul? We realize that operating under the impact of COVID-19 is far more than a half-year deviation from regular work practices; we’ve entered a new way of doing business. Likewise, loss mitigation strategies need to evolve rapidly beyond what was innovative in 2019 and embrace advancements for today’s default servicer: Forbearance automation that effectively migrates borrowers into workout plans in bulk. Self-service one-click loan modifications that leverage workflow advancements that are intuitive and flexible. Customer surveys that automate qualification and approve borrower specific relief options during the first contact. Solicitations to identify and calculate eligibility and compliance in straight-through processing. These features are all part of the newest CLARIFIRE® offerings and are described in our latest eBook. Let us show you how to future-proof your organization with CLARIFIRE®.”

XINNIX continues to see record-breaking student enrollment as some of the nation’s largest lenders sign up students by the hundreds in XINNIX Performance Programs, and it appears that the recruiting boom won’t be slowing down anytime soon. Many lenders have already committed to engaging XINNIX to help grow their sales team exponentially in 2021 and even into 2022. The XINNIX Model is designed to get new talent market-ready quickly while equipping them with the knowledge, skills and disciplines they need to be successful. If your recruiting strategy includes hiring rookies, XINNIX has the solutions for you: ORIGINATOR™ for new retail LOs, ORIGINATOR DIRECT™ for new consumer direct LOs, ORIGINATOR ASSIST™ for new LOAs, SOAR™ for new operations talent. Schedule a call with a XINNIX Account Executive today to discuss how The XINNIX System™ fits into your plans now and in 2021. 


Agency Excitement

Given their collective market share, most lenders either follow or pay attention to what Freddie Mac and Fannie Mae do. Primary and secondary spreads are wide due to profit margins. As that shrinks, it will open up more refi loans, the lion’s share going to F&F. The rollout of UMBS (Unified Mortgage Backed Security) was a success, but that was so “last year.” Also a success is the shift to working from home for the Agencies, definitely this year. Any lender selling to the Agencies should know that prepayment speeds are increasing. Is your company paying a premium for prepayment protection? The Financial Stability Oversight Council said the mortgage giants may need a bigger capital cushion than their regulator has proposed, but stopped short of designating them as “systemically important financial institutions.” Let’s see what they, with the tender guiding hand of the FHFA, are up to.

The FHFA announced it was seeking comments on a notice of proposed rulemaking that would require the GSEs to provide advance note to the FHFA of new activities and to seek prior approval for launching new products. It would also establish revised criteria for determining whether the new activity requires notice to FHFA and if it merits public notice or comment. FHFA Director Calabria said, “The proposed rule will enhance the safety and soundness of the secondary mortgage market by ensuring the Enterprises adhere to their statutory missions” and that “This proposed rule is an important step as the Agency works to end the Enterprises’ conservatorships.”

Freddie Mac is offering a live webinar panel exploring and discussing the HFA Advantage program and the benefits of working with Housing Finance Agencies. The panel consists of representatives from Golden State Finance Authority, Arizona Housing Finance Authority, Mortgage Guarantee Insurance Corporation. Thursday, October 22 2:00 pm

Eastern Daylight Time (New York, GMT-04:00)

Fannie is definitely emphasizing the “Green Bond” program; talk to your Fannie Mae team. (Freddie Mac’s not set up yet.)

Freddie Mac recently issued Guide Bulletin 2020-37 which, among other things, updated guidance for the Market Condition Credit Fee in Price and extended the effective dates for certain flexibilities related to COVID-19.

Fannie Mae has updated several COVID-19 Lender Letters to extend dates for temporary policies and flexibilities. Impact of Covid-19 on Originations (LL-2020-03), verbal verifications of employment and power of attorney flexibilities are extended to October 31st. Impact of COVID-19 on Appraisals (LL-2020-04), temporary flexibilities extended to October 31st; and Selling Loans in Forbearance Due to COVID-19 (LL-2020-06), has extended eligible note dates to October 31st and delivery to December 31st.

Fannie Mae updated the Valuation Management System (VMS) Valuation Order Template and revised the Evaluation Notices. Read SVC-2020-05 for details.

Fannie Mae updated COVID-19 Payment Deferral Lender letter LL-2020-07 and Impact of COVID-19 on Servicing Lender Letter LL-2020-02 to clarify when a borrower impacted by COVID-19 remains eligible for any future HAMP “pay for performance” incentives.

Fannie Mae published a new risk self-assessments providing tips and checklists to help mortgage seller/servicers effectively and efficiently manage risk. Use them to identify gaps and develop customized action plans to maximize your risk management.

Fannie Mae, in alignment with Freddie Mac, will change the trigger for automatic reclassification from four consecutive months delinquent to 24 consecutive months delinquent (measured by the last paid installment date). These changes will become effective for mortgage loans that become greater than four consecutive months delinquent on or after February 2021 remittance activity (based on January 2021 reporting activity). This practice will be subject to exceptions as described in Lender Letter LL-2020-13.

Fannie Mae’s SEL-2020-06 includes changes to remote online notarizations; clarifications to project standards requirements; the removal of validation of employment and income, changes to how variances will reflect HomeReady® eligibility; and updates clarifying cash-out refinance vesting requirements.


Events and Training

Today the Utah Association of Mortgage Professionals is bringing in yours truly to provide some perspective on the most important topics of 2020 and the outlook for 2021. Even if you’re not in Utah, dial in and say hi on October 20th at 11AM MT.

The Modern Mortgage SUMMIT: Learn from 28 top producers who average 365 loans closed so far this year. The event is today, 10/20, at 8AM PT.

Six months into the pandemic and remote lending in full swing, many teams are still working through the bumps and growing pains associated with converting a business model to a remote environment. Still trying to adapt your leadership strategies in this constantly shifting environment? Join Indecomm for its free Ask Me Anything webinar on Wednesday, 10/21 focused specifically on leadership strategies for mortgage lending practices in a new remote world. Hear from Brian Ralston, SVP of Mortgage Banking for NexBank; Rajan Nair, CEO of Indecomm; Narayan Bharadwaj, SVP of Automation for Indecomm; and Linda Bomar, SVP of Sales and Marketing for Indecomm.

Join SimpleNexus and Ellie Mae for The 3 Keys to Making a Successful Move to eClose, a webinar on October 21 at 1PM CT designed to guide you through key considerations to make while evaluating digital closing technology.

Freddie Mac is offering a live webinar panel exploring and discussing the HFA Advantage program and the benefits of working with Housing Finance Agencies with representatives from Golden State Finance Authority, Arizona Housing Finance Authority, Mortgage Guarantee Insurance Corporation. Thursday, October 22 2PM ET, 11AM PT.

Join Insellerate for this dynamic, free webinar “Managing The Borrower Journey” October 22nd at 11AM PT. “In today’s lending environment it is important for lenders to understand key data touchpoints and provide seamless access to telephony integrations, lead distribution, work-flow management, call reporting records, mobile application, so they can manage the borrower conversation and journey where and when it is happening. Learn about the evolution of CRM & Marketing Automation in the mortgage industry, data and key borrower touchpoints, the importance of telephony integration to intelligently engage borrowers, and mobile Innovation and its impact on borrower engagement and so much more.

It’s Membership Month at the California MBA: Your opportunity to add your voice to the strongest industry advocate in the largest state market in the nation! Join by October 31st and get 15% off your first year’s dues.

QuestSoft Corporation announced the initial line-up of speakers at its complimentary virtual event, the Lending Compliance and Risk Management Conference on October 26-28. The conference will provide attendees with insights on compliance and risk management, as well as the opportunity for registrants to interact in a video networking lounge.

Join Miniter Group on October 29th for its "Flood Compliance: Biggert-Waters to Today” Webinar covering flood risk and regulation. The webinar will provide a detailed compliance refresher for loan servicers and compliance professionals involved with NFIP/Joint Agency flood regulation.

National MI has a set of classes, already lined up for November: MI University webpage.


Capital markets

Looking at the bond market at the open of the week, U.S. Treasuries & MBS were buffeted by news about fading stimulus hopes. With little political motivation to compromise, House Speaker Pelosi (one of U-Haul California’s recent “Employee of the Month” along with Governor Newsome) gave Republicans until today to meet her demands as hope for a deal before the election faded (I’m pretty sure this has been the same headline the past two weeks). Democrats are pushing a $2.2 trillion package, while Senate Leader McConnell said the Senate will vote on a narrower $500 billion bill. President Trump said he wants a bigger deal than Pelosi's. Frankly, it’s bad news for the millions of Americans falling into poverty as unemployment checks dwindle.

Today’s economic calendar is already under way with September housing starts and building permits (1.415 million, lower than expected, and 1.553 million, ahead of forecasts). We’ve also had the Philadelphia Fed non-manufacturing indices for October. The Mortgage Bankers Association’s (MBA) latest Forbearance and Call Volume Survey revealed that forbearance numbers decreased by 40 bps to 5.92% of servicers’ portfolios as of October 11, 3 million homeowners are estimated to be in forbearance plans. Later this morning brings Redbook same store sales for the week ending October 17 and remarks from four virtual Fed speakers. Today’s MBS purchase schedule sees the Desk back to three operations which will total up to $5.6 billion, starting with $1 billion UMBS15 1.5% and 2% followed by $3 billion UMBS30 2% and 2.5% and $1.5 billion GNII 2% and 2.5%. We begin the day with Agency MBS prices worse/down a few ticks and the 10-year yielding .79 after closing yesterday at 0.76 percent.

 

Employment and Award

“Closers and underwriters who want to be in a growing fintech firm: Interfirst brings refreshing technology and common sense to your world. Interfirst is immediately hiring closers and underwriters and other positions on our team with competitive salary and benefits. Our low-rate no-lender fee combination makes us highly competitive with anything advertised online by any lender in any state, and our proprietary sales/underwriting process makes it easier for everyone on our team to win and deliver a high level of customer service. Interfirst provides you all the latest tools you need to work...wherever you are. Our leadership team has over 100 years of mortgage, sales/marketing, and consumer-related experience. Apply today.”

Innovation, Efficiency, and Family… the three most common attributes new hires point to regarding their decision to join Thrive Mortgage. Case in point are industry veterans Jamal Chubb and Josh Harvith who comprise part of Thrive’s Talent Attraction & Career Team. “Being in this culture makes it so easy to be enthusiastic when talking to recruits,” stated Chubb. “This company offers incredible growth opportunities to Originators and Ops Professionals across the country, and everyone I speak with hears that loud and clear.” Harvith added, “The culture of excellence in our company runs very deep. Our process is world-class, but it’s our people who drive our success!” Thrive Mortgage is growing in markets across the U.S. and is looking for ‘Humble, Hungry, and Smart’ professionals who want to be a part of something special. Contact Jamal, Josh, or Kindra Miller to inquire about open positions. We can’t wait to meet you!

Congratulations to STRATMOR Group Principal Seth Sprague, CMB, on being named Chairperson of the Certified Mortgage Bankers (CMB®) Society for 2020/2021. Seth served as vice-chair of the society for the 2019/2020 term and stepped into his role as chair at a virtual CMB event yesterday. Seth has served on several committees with the Mortgage Bankers Association (MBA) and has been an instructor with the MBA’s School of Mortgage Banking (SOMB) program since 2007. He has more than 25 years of mortgage banking and servicing valuation experience and joined STRATMOR Group as a Principal early in 2019 where he specializes in mortgage servicing rights (MSRs), servicing, cash flows, liquidity and mortgage profitability strategies.